Buyout shop Siris Capital Partners on Tuesday agreed to acquire Synchronoss Technologies Inc.'s (SNC) secure data sharing platform Intralinks Holdings Inc. for about $1 billion in a deal that brings to a conclusion an aggressive six-month public acquisition effort by the New York-based, tech-focused private equity firm.
As a result of the deal announcement, Synchronoss shares shot upwards by about 15% in pre-market trading to $15.80 a share.
The possibility of a deal first emerged in May when Siris disclosed in an activist securities filing that it had taken a 13% Synchronoss stake and suggested that it was interested in buying the cloud computing company. By October, the mobile information and data services company told Siris Capital that it could take a walk after the buyout shop said it would end discussions unless it could engage in exclusive negotiations.
But later this month, on Oct. 5, Siris made another activist filing essentially telegraphing the ultimate deal's framework. It noted at the time that it planned to negotiate with Synchronoss about the possibility that it would acquire its Intralinks division for $915 million in cash, an amount that was a bit less than the ultimate $1 billion purchase price. Siris, which owns a 13% stake, would also negotiate with the company about making a $185 million investment in preferred equity, which would be convertible into a 20% common share stake.
As part of the deal struck Tuesday, Siris agreed to make an $185 million investment in Synchronoss, which would be convertible into roughly 20% of the company's common shares. Also as part of the agreement, Siris agreed to buy all of Intralinks' stock for about $1 billion, making the unit a portfolio company.
Goldman Sachs & Co. and PJT Partners provided financial advice to Synchronoss. Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP provided legal counsel.RBC Capital Markets, Golub Capital, and Macquarie Capital are providing debt financing for the Intralinks transaction.
Evercore, Macquarie Capital, Moelis & Co. LLC, and RBC Capital Markets provided financial advice to Siris. Wachtell, Lipton, Rosen & Katz provided legal advice to Siris and Greenberg Traurig LLP acted as financing counsel to the private equity firm.
Bridgewater, N.J.-based Synchronoss provides a range of services to telecoms and large corporations, ranging from cloud services and mobile backup to messaging and Internet of Things analytics.
Clients include major corporations such as Amazon.com Inc. (AMZN) , Apple Inc. (AAPL) , Comcast Corp. (CMCSA) , Dell Inc., Goldman Sachs (GS) and Microsoft Corp. (MSFT) . AT&T Inc. (T) and Verizon Communications Inc. (VZ) are by far Synchronoss' largest customers, however, providing 62% of its net revenues in 2016.
-- Chris Nolter and Baz Hiralal contributed to this report
Amazon, Apple, Comcast and AT&T are holdingd in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells (AMZN) , (AAPL) , (CMCSA) or (T) ? Learn more now.
More of What's Trending on TheStreet: